ABC classification process

Feb 3rd, 2012
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California Institute of Technology
Course: operations management
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ABC analysis . What would be the primary value of ABC analysis to a retailer?Purpose of classifying items in this fashion?What would be the primary value of ABC analysis to manufacturer?

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The ABC classification process is an analysis of a range of items, such as finished products or customers into three categories: A - outstandingly important; B - of average importance; C - relatively unimportant as a basis for a control scheme. Each category can and sometimes should be handled in a different way, with more attention being devoted to category A, less to B, and less to C.A Category Items Comprise 20% of SKU & Contribute to 80% of $ spend.B Category Items Comprise 30% of SKU & Contribute to 15% of $ spend.C Category Items Comprise 50% of SKU & Contribute to 5% of $ spend.*The

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